Bowie council reviewing solar array possibilities; development could save customers on energy bills

The City of Bowie will take the next step in pursuing the development of a two megawatt solar array on a piece of city property by approving geotechnical testing on three potential sites.

The city council Thursday voted to enter an agreement with D&S Engineering for the testing. Last month city officials met with five developers to tour the sites with no specific site earning the majority interest of the companies. City Manager Bert Cunningham said the tests are expected to run about $21,500, with additional costs for other tests if they are needed.

Councilor Craig Stallcup suggested they require the selected developer to reimburse at least the cost for one site when they create an agreement. The city manager said he did not think they would be disagreeable with that stipulation, however, it could also impact the final power purchase agreement.

The City of Bowie obtained an amendment to its bulk power contract with Bryan Texas Utilities a little more than a year ago that will allow the city to get two megawatts of its power from another source other than BTU. The advantage to any power obtained from this source would be the lack of transmission fees on that two megawatts.

In addition the energy could help reduce the city’s peak demand. Distributors are charged a peak rate based on annual calculations from the four prime months, typically June to September, which also is the peak for solar production.

Councilor Arlene Bishop asked if they have any idea what this project could save the actual customer because previously it was going to be nominal. Mayor Gaylynn Burris said they have talked about anywhere from $45 to $60 per kilowatt hour, compared to what is paid now at $68 to $78 with transmission fees.

Cunningham told the county the city has received notice from the Electric Reliability Council of Texas ERCOT the transmission charges are going up 15 to 20 percent. Last month the city paid $66,000 in transmission fees and throughout the year pays about $1 million in fuel and transmission fees.

Those fees began back in 2014 thanks to the Competitive Renewable Energy Zone fees, which were divided among all power utilities across the state to pay for the power lines that are moving new wind-generated energy across the state.

“It will only get worse so it is sort of like this county mitigation plan, we have go to do something to mitigate this. The sooner we act and get on it the better off we will be. Our wholesale costs are not going to do anything but go up. Luckily our rates are not going up but the ERCOT fees are killing us,” said the city manager.

Burris said the savings numbers talked about previously were very broad ranging from $18,000 to $118,000 and it was unclear how that would help the city. The city finally opted not to pursue a project in spring 2016 that would have focused on the city constructing a site and operating it.

In this new proposal, the solar developer would have a 20-year power purchase agreement with locked in rates for the power purchased by the city. Cunningham interjected the developers are working toward tax advantages they are going to get with this project. Those tax advantages go away in 2019, so Burris said the council will need to make a decision in advance of that.

Bishop asked if there were any additional costs along with the test. Cunningham said lines would have to be run from the solar array to connect it with the city’s three-phase system.

Estimated costs for a line at the Farm-to-Market 174 property would be $20,000 to $30,000. Similar costs would be expected at the other sites behind the substation and at the old sewer farm behind the ball park. Although it all depends on how far the line has to run to three-phase. Stallcup added they could again tie those costs back into any contract.

The developer will lease the land, pay taxes and maintain the property. The council approved the testing with Bishop the lone no vote.

Cunningham reiterated they will not jump off into any project and as they narrow things down to a pair of developers he will have them and the engineers in to lay it all out for the council.